Young and Restless: Why money and saving it matters in your 20s

When was the last time a 20 year old cared about the future, more so as it relates to money, saving it and, heaven forbid, have a budget in mind if they’re finishing up college for example and embarking on the real world.

The truth is saving money and being financial smart with your cash starts before you even reach college, perhaps as young as when mom and dad doled out allowance on a weekly basis, and you had to make that five dollars last for the next two weeks.

Of course as a kid, that little bit of money might be easier to manage than a first paycheck or initial job out of college. The 20 something year old might still live at home, not have a car payment (you still have that car mom and dad gave you), and have very few if any bills.

What you don’t realize is that from a money standpoint, you are the ideal position, one that you want to hang on to and keep as simple and straightforward as it is at the moment.

The only debt you might be in the midst of accruing is your college tuition and any loans you’ll have. That interest rate, however, is remarkably low and shouldn’t be viewed as an albatross of debt but rather a necessity that helps you land a job out of school.

But in your 20s, fresh out of school and having that first job, now is the time for you to start saving your money, while you’re still nestled in your old room and mom and dad still have a fridge full of food.

For starters, you’ll want to put extra money toward your loans, rather than defer them. Skip a few nights out with your friends and stay in for a weekend here and there, and double up on those school loan payments. That is going to cut the customary 10 year loan for schooling in half, leaving you debt free by the time you’re in your mid 20s.

Even though the average college student accumulates up to $5,000 in credit card debt while in school (this typically is due to needing money while in school and not having a job as part of the equation), you have to understand in your 20s, debt and credit is a necessary evil to build up the latter. That isn’t to suggest that you should be taking on thousands of dollars in debt, but opening up a card and starting to charge and subsequently pay off the card makes sense financially to start showing your credit and paying back loans is credible and capable.

Those in their 20s who start thinking about money right away tend to be the success stories, the ones you hear about retiring in their 50s. If your 20s is a backdrop for excess and wasting cash, you’ll consider that time period a failure when 30 rolls around.

Five Types of Retirement Plans to Consider

Retirement plans are savings plans that help workers and individual consumers to save for when they get older and can no longer work. Several types of retirement plans exist, and they each have a unique quality. The following are some common types of retirement plans and some information on how they can assist a worker or consumer:

The 401K Plan

The 401K plan is an extremely popular plan for employees. The plan works by employer contribution and employee contribution. The employee can contribute up to 6 percent of his or her paycheck on a weekly or biweekly basis. The employer can then contribute up to a match of the employee contribution.

The IRA Plan

IRA is an acronym for individual retirement plan, and many variations of such plans exist. For example, as SIMPLE IRA is one that stands for savings incentive match plan for employees. Employees and employers can both contribute to a SIMPLE IRA plan. A Roth IRA is an example of another plan. A Roth IRA is a tax-deductible plan that people can place money into to build their futures. A Roth IRA is different from a traditional IRA in that it allows people to withdraw funds at any time without charging them penalties.

The Profit-Sharing Plan

A profit-sharing plan is a special incentive plan for employees. Employees are allowed to share the profits that the company earns based on a specific formula. New employees are usually eligible for profit sharing plans after a certain amount of time.

Stock Ownership Plan

A stock ownership plan is similar to a profit-sharing plan in that it uses something from the company. A stock ownership plan is a partial ownership of the company’s stock. The employee earns a small portion of cash when the company stocks go up and so forth.

Cash Balance Plans

Cash balance plans are special plans to which employers contribute to their employees. The employers usually make contributions to such plans at least once per year. Cash balance plans are amazing for employees on the young end of the spectrum because they grow immensely over time.

A new employee will want to ask the HR department or the benefits department about any retirement plans they offer. The new employee can start contributing to the plan as quickly as possible. The 401K plan is one of the most popular because some employers offer high contributions.

Profitable Spring Cleaning

All home and apartment dwellers find themselves ready for spring cleaning at one point or another. Spring cleaning is a process that involves purging oneself of unnecessary household items. Over the years, material items tend to accumulate because of poor organizational skills, impulsive buying, hoarding tendencies and more. Spring cleaning is necessary to bring the number of household items down to a nominal level. Additionally, spring cleaning can be an excellent way to earn extra cash. The following are some tips on conducting profitable spring cleaning:

Choose a Strong Day for Spring Cleaning

A consumer should conduct his or her spring cleaning on a day that will be convenient for everyone involved. Weekends are perfect for people who have traditional 9-5 jobs. The person will want to have a day free of obligations and distractions to conduct the spring cleaning in an organized fashion.

Recruit Friends and Family Members

Recruiting friends and family members is important for simplifying one’s spring cleaning efforts. Not all family members will be thrilled about cleaning, but some of them may be motivated by monetary incentives.

Have a “Trash Doesn’t Exist” Mindset

Spring cleaners must carry a “trash doesn’t exist” mindset. The TDE mindset is one that forces the participants to find a purpose for every item in the house that needs to leave the premises. One man’s trash is always someone else’s treasure. Any item can serve a person an important purpose, and consumers will buy just about anything for a discount.

Offer Electronics, Furniture and Household Appliances for Sale

Cell phones, televisions, microwaves, radios and the like are the most valuable material items in the house. Someone is always looking for such items for a reasonable price. The consumer can offer the items on an online site such as Craigslist or eBay. Someone will respond to the ad quickly, and the seller can use the funds for the good of the household.

See the Value of Used Clothing and Bedding

Sometimes people do not realize the value of old clothing. Clothing that cannot fit one person might fit another person perfectly. Homeless persons, single parents, and struggling residents will appreciate an offer of such clothing. Spring cleaners can sell their mounds of clothes for extremely low prices and still earn a substantial amount of money. Some yard sale sellers offer their clothing items for as little as $.25 per garment. Bedding is equally useful.

Any household can conduct a profitable spring cleaning event. Motivation, organization and creativity are the keys to success. 

Saving Early for Summer Holidays

Even though spring just arrived, it is not too early to think about and plan for summer vacations. Independence Day and Memorial Day are two of the most popular summer holidays in the United States and many choose to celebrate at home by purchasing food and having a barbecue with friends and family members.

Others may want to visit a festival that celebrates the holiday with music, games and the like. All holiday activities require one to have money. Therefore, a consumer will want to get ahead by saving cash before the summer months come. The following are four tips that a person can use to prepare for summer holiday expenses:

Divide Direct Deposit Funds

The best way to save for a summer holiday is to create a separate savings account and assign funds to the account on each payday. Most employers allow their employees to distribute the funds from their paychecks to various accounts. Designating a small amount of money on a weekly or biweekly basis is an effective way to build a vacation fund.

Perform Odd Jobs

Another way that one may want to save money for a summer vacation is by performing odd jobs. Odd jobs include jobs such as grass cutting, housecleaning, babysitting, web design, article writing and more. The person can place the extra funds in the previously mentioned savings account.

Make Advance Purchases

Persons will want to make advance purchases for holiday reservations such as hotel reservations, rental car reservations, restaurant reservations, festival reservations and the like. The savings can be humongous if the person secures the reservations several months in advance.

Use Coupon Codes and Special Memberships

Coupon codes and special memberships can remove some of the expenses associated with airline tickets, train tickets, rental cars, hotel stays and more. Consumers can receive discounts for having AAA membership or college membership. Additionally, a multitude of coupons and promotional codes exist online. One could enjoy double or triple savings by reserving accommodations early and using special privileges. He or she could use a promotional code during a checkout. The person could use the drop-down menu to specify AAA membership, college membership and senior citizen status, as well.

Summer holidays are always better when one takes the time to save enough money for the events. The consumer should do so by relaxing and saving a little bit at a time each week.

Save Money on a Dream Vacation

Going on vacation is expensive no matter where a person goes. However, some corners of the world are much more expensive than others are. For example, one night at a hotel in Key West, Florida costs about $600 for a four-star or five-star location. Additionally, special events such as boat rides and scooter rentals can end up costing several hundred dollars. The following is some information on saving money on such a trip:

Reserving a Room Early

Early room reservations can save hundreds of dollars. Scheduling a stay for non-weekend nights can save money, as well. The visitor will want to reserve the room approximately three months ahead of time to obtain the best rates. Weekdays are less expensive because many people have to work during the week. Hotels and motels are much less full during those times. The average price difference between a weekday and a weekend night can be as high as $100.

Using Plastic Resources

Credit cards and club memberships can give a person an edge on the pricing in an expensive vacation. Triple A membership can provide a visitor with a discount of approximately 10 percent off a hotel stay. Some credit cards offer points as rewards for normal credit card use. The points can shave some of the dollars off the average hotel stay. Additionally, such memberships and cards may provide the consumer with access to cheap rental cars for the road.

Finding Cheap Things to Do

Finding cheap activities is the key to making one’s funds last as long as possible in the Keys or other expensive areas of the world. All major activities will cost hundreds of dollars. However, a frugal visitor can conduct a variety of activities that cost little to no money. Picture snapping adventures are free, and they can be quite fun. All the person needs is a trusty camera and some fuel to drive around and see the sites. The person can search for monuments, landmarks, botanical gardens, parks and the like. Some botanical gardens cost money, while others only accept donations.

Beach walking is a fun free activity for families, lovers and lonesome people. The beginning of evening is a wonderful time to go outside and watch the moonlight develop. A beach-side sunset is beautiful, as well.

Many money-saving techniques exist. The previously mentioned tips can be a stepping stone or a starting point.

Avoiding and Stopping Identity Theft

Identity theft is a heinous crime that victimizes more than 11 million people each year. The crime includes stealing a person’s personal information to open new accounts, misusing existing accounts, and using personal information for alternative malicious purposes. Identity theft can ruin a person’s reputation with credit bureaus and other organizations, and it can take that person many years to resolve the mess. The following are some tips for preventing and dealing with identity theft: 

Do Not Share PIN Numbers and Passwords

Many people make the mistake of trusting lovers and friends with the PIN to their debit card. The problem with sharing a PIN is that a person who knows it can change it. That person can try to access other cards and accounts using the same PIN, as well. The consumer should trust no one with such information.

Change Login Information Frequently

Passwords to online bank accounts, email accounts and other important accounts should be changed at least once every three months. Once per month is a safer practice if the person has the patience to do it that frequently.

Obtain an Annual Credit Report

A credit report can speak volumes about identity theft. Every consumer should request one free copy of his or her credit report from the bureaus each year. The report will display all open credit accounts. The consumer should dispute any account that looks unfamiliar. The bureau must respond to the dispute within 30 days.

Sign up for Credit Monitoring Services

A credit monitoring service is an amazing tool for identity theft prevention. Such a tool will send a consumer instant alerts whenever someone opens a new account. It will notify a person if his or her credit score changes, as well. The debtor can then take action based on the information that he or she receives from the monitoring service.

Report Foul Play Immediately

A debtor should report a lost or stolen credit card immediately. Additionally, the person should contact the bureaus to launch investigations on any suspicious activities. Sometimes, the credit bureaus can place blocks on people’s social security numbers. No creditors will issue credit to these persons unless they answer a series of questions to verify their identity.

Finally, account holders should log into their online banking and credit card accounts frequently so they can catch strange activities quickly. Keeping one’s eyes open at all times is crucial. 

How to Keep up With Household Chores without Hiring a Maid!

Keeping up with household chores can be extremely difficult, especially when you have a busy life. Children love to spread their toys, crayons and miscellaneous papers all over the house. Some husbands like to leave clothing piles and dirty glasses in various places. Keeping the house together can be even more challenging when you have pets running around, and your workload is heavy. The following are some tips for trying to keep everything together and avoid clutter: 

Clean When Everyone Is Asleep

Avoiding messes and clutter can seem as if it is impossible when everyone is awake and moving around. A tactic that may work is setting the alarm clock for an early time such as 5 a.m. You may be tired at that time, but you will have at least a half hour to an hour to clean up while the rest of the household is asleep. Changing the cleaning schedule can be a very effective way to organize your household.

Perform Sweeps in Between Tasks

Another good way to avoid clutter and keep your house neat is to perform several five-minute sweeps throughout the day. Sweeps are little breaks that you take to remove trash from the floor, wipe down tables and counters, take the trash out, and place dirty clothing where it belongs. You can perform sweeps in between your schoolwork or your home office work. Additionally, you can perform sweeps when the commercials come on during your favorite television shows. You will be amazed at the amount of work you can do in two to five minutes, and your house will be almost spotless at the end of the day.

Pay the Family Members for Their Help

Sometimes the other members of the household need some special encouragement. Children love helping when they can receive a shiny quarter or piece of candy for their efforts. Husbands are likely to help if they can receive treats, as well. You can use your imagination to think of the best treat for your husband.

You can try setting a payment schedule for different tasks and see how your family members respond to it. This method will most likely leave your house neater and relieve you of some of the work.

Finally, you can avoid accumulating dirty dishes by rinsing them immediately after you use them. Alternatively, you can purchase Styrofoam and plastic dishes so that you can dispose of them every time you eat or drink. Styrofoam and plastic dishware is inexpensive, and it can keep you from spending too much time doing housework. 

Banking on it: How to avoid bankruptcy in your near future

When you hear the word “bankruptcy,” most of the time your thoughts turn to large scale companies or retailers that have no choice but to shut the doors and declare to fight (or re open) another day.

But what about bankruptcy as it pertains to an individual, couple or family as far as your financial planning and freedom or lack thereof.

Avoiding bankruptcy is unquestionably paramount, but when that word starts to surface in the household, chances are you’ve missed the warning signs and it’s too late to turn back from a road you ultimately didn’t want to travel.

One huge red flag that you’re headed down the wrong path is taking a moment to calculate your debt to income ratio on a monthly basis or taking into consideration your assets versus how much you owe that isn’t yours.

First, the monthly ratio is simple to figure out and is essentially how you’re judged by creditors and anyone else in line to lend you money. Your debt to income ratio on a monthly basis should be somewhere in the 30% to 70% ratio, respectively, at best. You also want to pay attention to your entire debt, minus the house and the car. This is more about checking into unsecured debt like your credit cards. If you have about $10,000 in your savings account and only a few thousand in your retirement account but are sporting double that in credit card debt, you should start coming up with a game plan to start paying it off and eliminating some expenses from your budget that can get cut.

Bankruptcy also might be chasing you down if you find yourself starting to miss payments one month after another. Missing a payment doesn’t just add a negative to your credit score but also is a huge sign that you are living beyond your means and eventually might not be able to pay your debt consistently.

In addition to missing payments, you might be at the point where creditors are starting to call your home and seeking out a debt consolidation company isn’t exactly going as planned.

Keep in mind that it doesn’t have to end this way when it comes to your finances as it relates to bankruptcy. It just happened this way because you were most likely careless with your spending but didn’t take note of bad habits that eventually grew into having to raise the white flag on your finances. 

How to Save Money at Yard Sales

Yard sales are events that homeowners and apartment dwellers hold to earn a bit of extra cash. Some people have yard sales to clear their homes before they move, and other people have yard sales to get rid of items after a divorce. Yard sales have a multitude of useful items that a frugal shopper can snag for an outrageously low price. People sell their books, movies, furniture, clothing, electronics, household appliances and collectibles at yard sales. A person can furnish an entire several-bedroom home with only a few hundred dollars just by visiting local yard sales. Additionally, smart re-sellers can find highly discounted treasures that they can flip for a profit. 

How to Find Yard Sales

Many people notify the community of yard sales by placing flyers on light poles. They may also pin up signs at the local laundromats. Daily newspapers contain yard sale listings in the classified sections, as well. Technologically savvy individuals place their yard sale listings online on websites such as Craigslist. A person who wants to visit a yard sale can use the aforementioned means to find out when members of the community will have them. Most yard sales occur on Saturdays and Sundays. A few scattered families may have them on Friday. An ambitious person could wake up on Saturday or Sunday morning and drive around to find random events.

Bargaining at Yard Sales

The prices of yard sale items are already very low, but there is always room for a person to negotiate. The best way for a person to get a massive discount on an item is to leave the yard sale and come back later in the afternoon. Yard sale sellers will be willing to negotiate by the end of the day because their main purpose is to move everything off the tables. However, a person who does not want to risk losing an item to another buyer must act fast. That person should ask the seller the price of the item. Once the seller states the price, the negotiating party could make an offer that is 50 percent less than the stated sale price is. The seller may accept the offer, decline the offer, or come back with a reasonable midrange price. There is certainly no harm in trying.

Yard sales are amazing for furnishing a new home or gathering supplies and equipment for an office. At least one yard sale occurs every weekend. 

IMPROMPTU SCRIPT: Rising costs of medications don’t have to affect your budget

Not all medications are created equal, especially in the eyes of the health care companies that are paying the majority of costs for them.

Consumers who wait patiently on line at their pharmacy of choice are incredibly grateful when they compare the actual cost of the medicine versus what your co pay actually ends up being. That $5, $10 or $20 price tag far exceeds the potential of paying in upwards of a few hundred dollars for one prescription.

But what if you can’t afford health care or you have one particular medication that either isn’t covered or your insurance company only takes care of a small piece of an otherwise large expense. That means you’re responsible for the remainder, and that hefty price tag might be too much for you to handle.

Spending as much on medicine per month as you would on a car loan or mortgage is more than enough to sink any thoughts you might have of saving money.
Aside from shopping around and buying health insurance on your own, that still doesn’t account for co pays on specific medicine that might be too much for you to handle. If that situation arises, you don’t have to sacrifice what money you have stored away or go deeper into debt just to ensure your health isn’t compromised.

You have options that go well beyond taking out a loan to cover these added expenses.

Consider ordering your medication in bulk through a mail order company that specifically deals in generics. Even if they don’t have generics are part of the equation, ordering large amounts at one time cuts back on the overall cost.

As part of your doctor’s office visit, you can always ask the physician for some free samples in the short term or inquire with the office manager about any types of assistance programs, whether those are on the national or state level or done directly with the drug manufacturer.

Some of these programs are directly related to your income and can drastically reduce your out of pocket expense. A $50 copayment, for example, could go down to $5 just by asking a few questions and filling out a bit of paperwork.

And when in doubt, you can always go back to an old reliable: coupons or various promotions offered by the retail. Plenty of weekly circulars from the likes of K Mart and Target toss incentives toward customers in the form of gift cards or discounts if they switch pharmacies. When it comes to prescriptions that become remarkably difficult to pay for, every dollar off counts.

The toughest aspect of medication as it pertains to saving money is knowing that, no matter what, you’re going to need the prescription. How you go about securing them and, more importantly, paying for them determines your financial fate moving forward.